5 ways to start developing a new pattern of investment
I was inspired by Jamie Notter's post on strategy as a pattern of investments. In part of the post, he talks about how associations seemed to be locked into a pattern of investments that center around membership or meetings or advocacy--equating this to coloring inside the lines. He implores us to think about what different patterns might exist.
How?
This is messy, not easy stuff, but I immediately thought of a couple ideas I have presented on Acronym before. So if I started with those two, I challenged myself to come up with three additional exercises association leaders could use to start thinking about different patterns, giving the nice, round number in the title of this post. So here are my 5 ways to develop a new pattern of investment:
1. Budget and plan differently. I wrote a post several years ago and have referred back to it a couple times over the years. In it, I advocate trashing your annual budget planning. One of the main ideas I was trying to get across was to stop making strategic decisions because of an arbitrary date on a calendar. Another idea, though, was how to look at programs. Each program has its own plan and budgeting timeline. So, for example, you are continually looking at how a program is doing versus how you expected it to do, and constantly adjusting those expectations and strategies moving forward. A year is simply too long of a timeframe for most programs--even ones that happen once a year. The next step is to institute some guidelines or procedures. If a program is consistently falls below expectations even though you've been trying new strategies, then it's time to begin sunsetting it. And this happens constantly across multiple programs at all different times of the year, not just once a year.
2. Do the exercise that Steve Anderson did that I talk about in this post on focus. Assess all your offerings and then talk about what it mean and how your organization would look if you stopped doing most of them and focused on making the ones that are most valuable even more valuable (and spend some time thinking about new offerings).
3. Carve out some Google time. It's a well worn story in innovation circles: Google telling it's employees to focus 10 percent of their time on new or different projects that are not part of their main job--and then ensuring they have the space and capacity to do so. I don't think I've ever heard anyone say that such a strategy is dumb. So why isn't every organization doing something like it?
4. Develop a process for new ideas. Years ago in an old Executive Update magazine I produced, we outlined an interesting idea process (pdf). It might need to be modernized now, but it could be a place to start. The point is, develop a process for creating and considering new ideas, and then put it into practice. You can always adjust it if it's not working quite right, but having the process will encourage those who care about the organization to take part.
5. Do this exercise: Assume that in the next 24 months your organization is going to lose 75% of its dues income. What would that mean for your organization? The products and services you offer? It probably means generating income from other sources--what possibilities do you have? It probably means changes to your staff and volunteer structure--what would those look like?
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Comments
Awesome! I particularly love #5, and not because I think we're all going to lose dues revenue (though it wouldn't surprise me). I like it because it's a perfect way to shake up your thinking. It forces clarity. I posted on that over on the Common Thread Blog.
Posted by: Jamie Notter | June 30, 2010 8:28 AM
Yeah, I don't know if 75% is right, and I don't know if 2 years is right, but I'm with you Jamie, it's no secret I think the dues-paying model is heading for drastic changes. But as you say, even if it's not, this exercise doesn't hurt. After all, no one can argue with the 50-year trend that dues as a percent of total income has been declining.
Posted by: Scott Briscoe | June 30, 2010 10:34 AM
Scott, I do not believe the idea of 20% time (not 10%) as practiced at Google is stupid, but it really isn't an appropriate innovation strategy for most associations. 20% time, just like 3M's 15% rule, is more about permission than it is about the time. The vast majority of associations lack the cultural tolerance for ambiguity that is essential in making an initiative such as 20% time work effectively.
If associations really want to change their current patterns of strategic investment, a good place to start would be figuring out the percentage of revenues/profits generated on the basis of ideas that are less than 12-18 months old. If the patterns are stale, there will be very little revenue/profit that fits this description, and that discovery should create the space for a generative conversation about building capacity for creating radically new value.
Posted by: Jeff De Cagna | July 5, 2010 10:38 PM
I know it's not like 'Google time,' but I know that serving on interdisciplinary teams 20 yrs ago at NAHB extended my tenure there and sparked my interest enough in other associations enough to lead me to consider moving to another association and then MGI far earlier in my career than I would otherwise have left. In our case having 350ish staff in 40 departments with very unique specialties, constituencies, and management objectives led me to feel somewhat isolated and very curious about what my colleague were doing. So I would tend to agree with Jeff that in some settings it can be wasted time, or at least misdirected resources, but if some initiatives represent purposeful redirection of staff resources into areas that are not their area of functional expertise or core competency, it can serve the institution and give more staff an 'excuse' to be engaged in work that it broader than what they generally do for the association.
I know at NAHB that forming teams to accomplish specific functions such as designing & creating a member/customer service center definitely gave me more of an organization-wide perspective and helped me out the door, which was a good or bad thing depending on how my boss/colleagues felt about me. But using some device to help staff broaden their perspectives and contribute in more diverse ways strikes me as a good thing, not just for behemoth associations but also small ones where I also see many staff somehow cocoon into 'silos of one' over time.
At the other extreme I've seen some associations over focus (in my opinion) on constant meetings. This facilitates interactivity, at least at a management team level, but my 'Goldilocks instinct' says it's too much, in some cases eating as much as 50% of the average workweek.
Kevin
P.S. Scott-what is the data source you have for a 50-year decline? First I've heard of it--intriguing if true although the thing that struck me from conducting a financial structure survey back in the late 90s that showed trade associations actually moved very little, and in the 'wrong' direction (several pct points higher dues relative to non-dues).
Posted by: Kevin Whorton | July 7, 2010 7:50 AM
If dues as a percentage of income has decreased, is it because the dues model is faulty or is it because associations have been smart enough to create other income-generating activities?
Posted by: David M. Patt, CAE | July 9, 2010 10:56 AM